Reuters reported last month that the average price of an apartment in Dubai rose by 13 per cent in 2012, and it’s thought that this waslargely thanks tospeculators “propping up demand”. It’s thought the move by Central Bank is designed to clear the market of speculators, and to prevent prices from rising artificially high and creating another real estate bubble.

But news of the mortgage cap has sent shockwaves through the Western expat community. For many families hoping to buy a basic three-bedroom villa in a popular expat area such as The Meadows or Arabian Ranches, the 50 per cent deposit of AED 1.5 to 2 million (£250,000 to £300,000) is simply out of reach.

It’s also bad news for the “large number of professionals” that global property consultancy Knight Frank says are enquiring about “high quality family homes” in Dubai as they look to relocate here from Asia and the UK. But, with a four-bedroom villa on popular Palm Jumeirah already costing anything from AED 7 to 14 million (£1.16 to 2.3 million) and prices predicted to rise by five to 10 per cent this year, families hoping to buy a villa there will now need to stump up a deposit in excess of £580,000.

Neither is it good news for existing homeowners. Those currently trying to sell their properties will face a dearth of buyers, while those planning to sell in the future may have to ride out a big drop in prices. As the property sales market slows down, rents in Dubai – which already rose by 17 per cent last year and were already predicted to double in the next three years– will rise exponentially, potentially impacting on inflation.

The changes would be “clearly negative if implemented,” Julian Bruce, of EFG-Hermes Holding SAE, told The National. But what’s the solution? Commentators have suggested that allowing a higher percentage mortgage for a first property and 50 per cent for a second would be more practical; others have suggested the government targets speculators directly by applying a financial penalty for selling a property within a set time frame.

How this will play out is anyone’s guess. We watch and we wait.

Annabel Kantaria is a journalist who moved to Dubai long before most people knew where it was. She doesn’t ride a camel to work; has never seen a gold-plated golf buggy and only rarely has pink champagne for breakfast. Follow her on Twitter: @BellaKay